For those who are considering the purchase of a new or used yacht, the question of protection is often not the first element that comes to mind. However, as a professional one-stop yacht service platform, we often receive similar questions: ‘Can I insure yachts for sale before delivery?’ The answer is: of course you can, and it is recommended to do so as soon as possible. This is a way to protect your rights and interests, and is the first step in ensuring a worry-free yacht experience in the future.
When to insure a yacht for sale
Whether you're ordering a new custom-built yacht or purchasing a pre-owned yacht of a certain age, it's always wise to make insurance arrangements prior to official delivery. It is not uncommon for risks to arise, particularly during transport, sea trials and lifting and launching of the vessel, and the definition of liability in the event of these risks is often extremely complex. Taking out insurance in advance ensures that you have both legal and financial protection for your new yacht before it is officially in your hands.
Why arrange insurance for yachts for sale?
Some of you may wonder why you need insurance when the yacht hasn't even been driven away yet. But in fact, from the moment you sign the purchase agreement, part of the risk and responsibility is transferred to the buyer. Especially if you are buying a yacht through a loan or financing, a certificate of insurance is often a necessary document before releasing the money. What's more, if the boat is intended to be used for racing, chartering or sailing abroad, the relevant organisations basically require insurance as a prerequisite for compliance. Therefore, the question ‘can you insure yachts for sale before delivery’ can be interpreted in a different way - taking out an insurance policy in advance is a sign of responsibility.
What risks are generally covered by yachts for sale policy?
Although products vary from one yacht insurance company to another, the main coverages broadly include:
Accidental damage such as fire, theft and collision
Third party liability claims (e.g. injury to another person's property or person)
Damage to the hull during transport, loading and unloading
Damage during land transport
Accidental injury to persons on board
Legal fees related to rights defence, etc.
However, it is important to read the terms and conditions clearly before signing up. Many policies do not cover race damage, natural aging of equipment, engine failure and losses caused by human negligence, especially masts, sails and other parts of the boat, which are often difficult to be compensated for in the absence of additional ‘race cover’.
How do I assess whether to choose this policy?
The budget for yachts for sale is already a significant investment, so a policy should not be based on price alone. What is more important is whether the coverage covers how you will actually use the yacht, such as whether you plan to sail out of the country, whether it will be used for commercial leasing, or even whether the yacht will be moored for a long period of time in a specific area marina - all of these may affect the conditions of the claim and the level of the premium.
It is advisable to confirm the following points with your insurer in advance:
Whether there is an overseas or race cover clause
Whether it is an ‘agreed value’ policy and to ensure that the amount reflects current market valuations
Whether or not it allows for discounted premiums for marina berthing.
Whether it supports transitional cover during yacht repairs or transportation
What else do I need to be aware of once my yacht for sale policy is in force?
The insurer should be informed of any changes in the use of the yachts for sale, its moorings or even the addition of new equipment as soon as they occur to ensure that the cover is valid. Many people rest on their laurels after completing an initial policy, but failure to update usage information at a later stage is often one of the reasons for refusing a claim.
Can I insure yachts for sale before delivery? This is not just a technical question, but a matter of protecting one's assets, and Yachttrading encourages every buyer to understand the terms and conditions of the insurance policy before making a decision, and to contact a team of professional advisors for a preliminary policy match if necessary.
